HOUSTON—The Continental pilots, represented by the Air Line Pilots Association
Int’l (ALPA), have filed two group grievances against United to protest
violations of scope provisions in their collective bargaining agreement
applicable to a merger during the period of separate pilot contracts and
operations of the two airlines, legacy Continental and legacy United. The first,
filed June 2, 2011, concerns removal of B-767 aircraft from the Continental
fleet (by sale). The second charge, filed June 16, 2011, is related to a
reduction in the ratio of Continental to United flying required with respect to
twin-aisle aircraft, specifically for the third quarter of 2011. ALPA is seeking
prompt correction of these issues by the Company, including a stop to any
attempts at further sales of B-767 aircraft, correction to the ratio of flying
performed by Continental to United, monetary damages and all other appropriate
relief.

“Once again, management is seeking short cuts to the merger process and trying
an end-run around our contract instead of negotiating at the table,” said Capt.
Jay Pierce, chairman of the Continental pilots’ chapter of ALPA. “In the airline
industry, attempts to cut corners typically lead to very bad results. Blatantly
disregarding our existing contract not only runs contrary to management’s stated
interest in reaching ‘fair’ resolution on a new contract, it is no way to make
progress toward successfully completing the merger and securing much-anticipated
benefits for passengers, shareholders and employees.”

These two incidents mark the second and third time since the merger close date
in October 2010 that ALPA has been forced to fight off management attacks to the
Continental pilots’ contract. In December, an arbitrator ruled in favor of ALPA
and against Continental management in their attempt at circumventing scope
provisions related to 70-seat jet flying.

The Continental scope provisions protect pilots’ job security, both generally
and during a transaction such as a merger. The provisions reserve for
Continental pilots all flying performed by or for Continental or an affiliate,
while allowing exceptions for flying that can be performed under code share or
by another airline, such as foreign carriers, Continental Connection and Express
carriers. During the period of separate operations in a merger, the scope
provisions, among other things, prohibit certain types of fleet changes and
require that ratios of Continental pilots’ flying to the merger partner’s flying
equal or exceed those same ratios prior to the merger.

ALPA represents over 53,000 pilots at 39 airlines in the United States and
Canada, including approximately 5,000 pilots at Continental Airlines.